MinnEcon Category Archive: Health care

Live chat: Nursing shortage myths and misperceptions

Posted at 11:03 AM on May 18, 2012 by Michael Olson (4 Comments)
Filed under: Health care

Comment on this post

MN MedTech and FDA plan partnership on regulation

Posted at 4:43 PM on December 5, 2011 by Bill Catlin (0 Comments)
Filed under: Health care

Amid much consternation about the cost and effectiveness of the FDA's process for approving new medical devices, the industry's trade association in Minnesota is announcing plans for a partnership with regulators to develop "regulatory science."

Both industry and regulators are taking lots of flack these days.

The industry has been battered by deaths and injuries related to faulty products, and pilloried for consulting payments to physicians. Meanwhile, the industry has long complained the FDA's device approval process takes too long and is too expensive.

Earlier this year a study reported in the Archives of Internal Medicine found most medical devices recalled in recent years as a result of deaths or life-threatening problems were approved under regulatory criteria that don't require human testing. An accompanying editorial said, "millions of Americans may be at risk for device-related injuries and recalls from high-risk devices that were cleared by FDA without any supporting clinical trial data."

On the eve of LifeScience Alley's Tenth Annual Conference & Expo this Wednesday, this message arrived in the inbox from Dale Wahlstrom, President & CEO of LifeScience Alley and The BioBusiness Alliance of Minnesota. Wahlstrom said he and Jeff Shuren, Director of the FDA's Center for Devices and Radiological Health will be signing a memorandum of understanding (MOU) between their respective organizations.

The MOU is a critical step in a partnership that has been developing between LifeScience Alley and CDRH for over a year. It recognizes that CDRH and the medical technology sector represented by LifeScience Alley have shared interests in further developing regulatory science and in enhancing the understanding of the safety, effectiveness, quality, and performance of devices. This agreement builds the foundation for specific projects that will improve the environment in which the medical device industry is operating, including a more formal partnership involving MedTech community members, University of Minnesota experts, and CDRH.

Dr. Shuren will also deliver a keynote address explaining what regulatory science is and how the partnership model we are working to develop in Minnesota will impact the development, analysis and approval of medical devices.

Comment on this post

No big bounceback in nursing job openings

Posted at 12:26 PM on September 29, 2011 by Paul Tosto (0 Comments)
Filed under: Health care

Nursing has long been viewed as recession-proof. No matter how bad the economy, we've been told, the demand for registered nurses would be consistent and yawning.

The Great Recession showed that's not the case.

The recession slashed job vacancies in Minnesota by more than 75 percent. Openings have recovered somewhat. But like other sectors of Minnesota's economy the recovery is not great and nowhere near pre-recession levels.

Registered nurse openings at the end of 2010 remained down more than 50 percent from the start of the recession. Recently released job vacancy data from the Minnesota Department of Employment and Economic Development showed openings flattening at that lower rate.

Here's the trend, including the most recent data for the second quarter of 2011.

What's happening? Health care facilities -- like every other business since the start of the recession -- are trying to hold down costs. And older nurses are putting off retirement in the tough economic times, limiting the number of job openings.

Our concern remains the significant number of people like Curt Peterson who went back to nursing school at community colleges for two-year degrees thinking they would get great paying super flexible jobs at hospitals. Those jobs dried up and as the economy recovers hospitals will be able to choose RNs with bachelors degrees from the pool of RNs still seeking jobs.

Associate's degree graduates may find jobs, but they're more likely to be at assisted care facilities and clinics, which generally pay much less than hospitals and have less flexible schedules.

So, if you were a mid-career person in the Great Recession who thought you could get more money and better working conditions by going back to school for two years to become a nurse, you might be seriously disappointed.

Comment on this post

Clinics treating poor face payment pain

Posted at 3:05 PM on June 23, 2011 by Molly Bloom (0 Comments)
Filed under: Health care

(MPR Photo/Tim Post)

Like many organizations that get money from the state, hospitals and health care providers are planning for a state government shutdown. But they're also dealing with the ripple effects from last year's budget-balancing agreement.

One of the ways legislators balanced last year's budget was to delay some Medical Assistance payments during the last month of the fiscal year (June 2011) and then pay providers what they're owed at the beginning of the next fiscal year (July 2011).

Normally this delay wouldn't cause a big headache for providers. But if the state shuts down, they will not get their delayed payments or payments for the new fiscal year until the shutdown ends.

Karen Smigielski, a communications officer for the Minnesota Dept. of Human Services, says that 9,158 health care providers are affected by this payment delay and the total amount of the delayed reimbursement payments will be about $157 million. The current payment delay does not affect MinnesotaCare payments or payments for in-home services.

One of the largest providers being affected by this delay is Hennepin County Medical Center. Vice President for Public Policy and Strategy Mike Harris says their delayed June payments will total about $19 million. He says they can deal with a one-month delay without major problems since "their operating performance has been a little bit better than normal this year." However, if the delay continues after June 30, "it will be very challenging."

If the government shuts down July 1 and payments are delayed further, Harris predicts they will reduce service levels, seek relief from vendors and delay capital projects.

This story came from a tip from our Public Insight Network. How would a shutdown affect you? What else should we know? Help us cover this story by sharing your insights here.

Comment on this post

Nursing job openings took a hit in bad economy

Posted at 9:15 AM on May 10, 2011 by Paul Tosto (2 Comments)
Filed under: Health care, Jobs & unemployment

We posted a bunch of stories and data last summer about the market for registered nurses in Minnesota and the country, and we asked aloud if colleges were producing too many nurses.

The response from several national nursing groups was, basically, that we were way out of line and that the demand for nurses in the future remains huge despite a short term drop in demand caused by the recession.

Updated data, though, show the job situation hasn't improved much a year and a half since the recession ended and the recovery officially began.

The table below shows what's happened to job vacancies for registered nurses in Minnesota.

(Source: Minnesota Department of Employment and Economic Development)

The recession slashed job vacancies by more than 75 percent. There is a recovery. But like other sectors of Minnesota's economy the bounce back is not great. Registered nurse openings at the end of 2010 remain more than 50 percent down from the start of the recession.

Here it is in a chart form.

At the same time RN vacancies were diving, the annual crop of newly minted RNs continued to rise.

Here's a look at the number of first-time takers of the NCLEX exam in Minnesota. The NCLEX is the gatekeeper national exam to become a working nurse. First-time test takers offer a decent snapshot of the potential pool of people coming out of college and adding to the RN work force.

The combination of new grads and plummeting opportunities drove down the employment prospects for people who graduated with nursing degrees in the recession.

Here's a table from the Minnesota State Colleges and Universities System breaking down the number of nursing graduates and the percentage employed after one year (click on the table for a larger view).

Before the recession, getting an RN job within a year of earning a degree was a virtual certainty. Two years later that was no longer the case.

No doubt that the economy put a major squeeze on hospitals and other health care providers.

Like every other business, they were cutting jobs and trying to hold down costs. It's also more than likely that older nurses put off retirement in the tough economic times, dampening the number of openings for new grads.

Job openings have started to pick up again. But if you were someone who went back to college to retrain as a nurse thinking a well paying "recession-proof" job awaited, you might have been shocked.

MPR's Tom Robertson got at this issue in a recent story that featured laid off lumber mill workers who went back to school and retrained to become nurses.

Before the lumber mill closed, 56-year-old Curt Peterson never would have guessed he'd be a student again. He said the pace has been grueling.

"It's just been nose to the grindstone," Peterson said. "And you're thinking, 'Oh, will it ever end?' Well, here we are, and it's, 'Oh, my gosh, now we have to get a job.' "

Peterson thought he could ride out the recession in school and come out with a nursing degree that was in high demand. But he's finding there are fewer local job openings than he'd expected. And competition for those jobs may be intense.

The most recent Minnesota labor projections still project an average need for about 2,400 new RNs a year through 2019 to meet new demand and replace retiring nurses.

If that holds, it matches up decently with the number of new grads passing the RN gatekeeper exam in Minnesota. Problem is, we don't know how many people from other states and other countries are looking for RN jobs in Minnesota.

Our concern remains the significant number of people like Curt Peterson who went back to nursing school at community colleges for two-year degrees thinking they would get great paying super flexible jobs at hospitals. Those jobs dried up and as the economy recovers hospitals will be able to choose RNs with bachelors degrees from the pool of RNs still seeking jobs.

Associate degree graduates may find jobs, but they're more likely to be at assisted care facilities and clinics, which generally pay much less than hospitals and have less flexible schedules.

So if you were a mid-career person who thought you could get more money and better working conditions by going back to school for two years to become a nurse, you might be seriously disappointed.

That's a message that, in the short term anyway, prospective students need to hear.
___________________________

Help Us Cover This Story

Comment on this post

Your health coverage. What happened? 6 words.

Posted at 2:49 PM on February 1, 2011 by Paul Tosto (0 Comments)
Filed under: Health care

Last spring we asked you to sum up in six words your experiences with health care coverage during the recession.

Your responses were eye-opening.

Minnesotans in MPR's Public Insight Network shared more than 100 stories of success and frustration (mostly frustration) searching and paying for affordable health care.

One in particular spoke volumes about life in the recession: "Clueless until I lost my job."

With the economic recovery officially a year and a half old, we want to see if things are better.

So tell us your health coverage story in six words.

Our post Monday on the health care haves and have-nots in Minnesota. got us remembering how much we learned from our audience with last year's six word challenge.

Updated numbers from the state Health Department show how the recession torpedoed the way many of us paid for health care. Employer coverage dropped significantly in the downturn and people shifted to publicly subsidized programs or simply went without coverage.

The data show how much the job market supports our health care coverage and how deeply the recession has reached into the state's middle income homes.

So tell us now what's happened to your coverage. Post something below or share your response with us directly at MinnEcon. Briefly.

We've also added a question this time around Will the new federal health care law directly help you or anyone you know? You can go more than six words on that one.

By the way, here's how I summed up my health care coverage experience last year:
Job questions: Prior conditions covered? Affordably?

Those were vital questions when I took this job. One of my kids has significant health needs. Happily, the answers were yes. But those questions will drive my job decisions for a long time to come.

NOTE: Our efforts were inspired by SMITH Magazine's ongoing Six-Word Memoir project.

Comment on this post

Haves, have-nots in MN health coverage

Posted at 12:45 PM on January 31, 2011 by Paul Tosto (0 Comments)
Filed under: Health care

Lost job. Lost health coverage. Rolled dice.

That was the consistent theme among many of the folks in MPR's Public Insight Network who responded to our queries on health care during the recession.

The last three years took out a lot of jobs and in the process torpedoed the way many of us paid for health care.

Updated data in a new Minnesota Health Department report show a "significant decline" in people with employer based health care, driving much of the drop in the insured the past few years.

Below are some compelling charts from the report (click on the charts for a larger view).

Yes, they're focused on health coverage but these are really snapshots of the hits our typically resilient state economy took in this recession.

Take a look at the data and the report and tell us what jumps out at you.

Here's the distribution of where Minnesotans got their health coverage and how it's changed. In 2001, employers were the source of nearly 70 percent of coverage. Seems like ancient history. In the recession, nearly 40 percent of Minnesotans were either in a public insurance program or just went without coverage.

Here's a breakdown of uninsured by income. The biggest jump in the recession came for families just above the poverty line -- $22,050 for a family of four. Another big jump came in the middle incomes -- families of four earning $66,150 to $88,200.

Interestingly, coverage rates have improved in the recession for the lowest income Minnesotans.

Collectively, the data show how much the job market supports our health care coverage and how deeply the recession has reached into the state's middle income homes.

The recovery began officially in June 2009 but the state unemployment rate remains stuck at around 7 percent and state officials say it will be mid-2013 before the state recovers the job counts lost in the recession.

That makes it unlikely the health coverage numbers will be any better any time soon.

Among states, Minnesota still has one of the highest rates of health insured citizens. That doesn't help those who can't pay for coverage or can't find a job that eases the burden.

Comment on this post

When your health plan goes away

Posted at 1:45 PM on January 6, 2011 by Paul Tosto (4 Comments)
Filed under: Health care

MinnEcon note: For most of us, it's a hassle to change health plans or providers. For people with disabilities and limited incomes it can be a nightmare. Here's a post from MPR's Melody Ng.

What happens when your health care plan stops existing? You hope you're already enrolled in another one -- especially if you're someone with physical disabilities.

Two recent stories from Minnesotans in MPR's Public Insight Network show how changing plans can become a crisis for those who depend on them for medical care and services to live independently.

"Individuals experiencing disability, chronic illness ... rely on [their health plan], sometimes hour-to-hour, day-to-day. These are critically important life support, safety, and security pieces," Lance Hegland of Minneapolis told us.

Hegland, 38, has spinal muscular atrophy. He and 1,275 other Twin Cities adults with physical disabilities had to find new insurance plans after UCare decided to close its UCare Complete program, also known as Minnesota Disability Health Options (MnDHO), as of Dec. 31.

The plan was vital, unique among health care programs, because UCare collaborated with AXIS Healthcare to combine health care coordination with services for independent living. In doing so, MnDHO promoted preventative care, reduced hospitalizations and improved quality of life for people with disabilities.

But it was expensive.

UCare closed the plan reluctantly, concerned about future cuts in federal Medicare payments that "combined with state budget cuts and the uncertainty for future funding made the MnDHO program unsustainable for us to operate with the type of quality programming that we felt was required," said Ghita Worcester, UCare's senior vice president of public affairs and marketing.

UCare helped Hegland and others find alternatives. Worcester said about 1,200 enrollees managed this transition.

Others, though, are still looking for answers.

Johana Schwartz knows she has health insurance. What she doesn't know is who's providing it.

The 29-year-old from Inver Grove Heights chose and submitted paperwork for a new provider on Dec. 10. But she says no one's responded to her application or repeated phone calls.

So, she has no idea if she's now covered under the default plan UCare rolled undecided people into, or if she got the plan she asked for.

She's also unclear on her failing adaptive equipment needed for cerebral and speech disabilities.

Last week, her group home noticed her ankle braces were coming unraveled. She needs a new battery for her speech communications device as well. A few weeks ago, she got the requisite doctor's prescription and ordered the battery, but it wasn't processed in time. Now Schwartz must wait for her new plan to kick in -- whatever plan that is.

She described her situation as, "Scrambling... Crazy enough without holiday business hours interrupting. Franz Kafka's bureaucratic chaos."

Hegland has health insurance under control. His transition to a new plan using AXIS Healthcare was "fairly seamless." But MnDHO's closure was hard on him, too.

"The initial uncertainty and impact of change created tremendous anxiety, fear and frustration for many people in our community," he said.

In a surprising twist, after nearly a year of researching insurance plans and stressing over his future without AXIS (he credits AXIS for motivating him to see his primary care doctor regularly and helping him participate actively in community life), Hegland still has AXIS coordinating his daily care.

His new insurance provider recently contracted AXIS to manage home- and community-based services. In the shuffle, though, Hegland lost the coordinator who's managed his care since 2005.

So he's relieved, but frustrated, too.

"Many of us are right back where we started ... yet we invested a lot of resources over the past year to pull off this transition."

He's not talking about just his own resources; he's concerned about taxpayer money spent and wondering what notes we should be taking to manage health care and other services for aging Baby Boomers.

AXIS executive director Randy Bachman says the Minnesota Disability Health Options model was "ahead of its time," and did a lot of good for many people. He believes with health care reform the model will reemerge.
___________________________________

If you were part of the MnDHO / UCare Complete plan or know someone who was, share some insights and help us add to these stories.

Comment on this post

Health care options for 2011: What did you choose?

Posted at 6:36 PM on December 7, 2010 by Paul Tosto (0 Comments)
Filed under: Health care

Last month, we started bugging Minnesotans in MPR's Public Insight Network to tell us what their health care options looked like for 2011 and what they might pick.

We got back a bunch of good responses. We'll share some of the stories later this week but wanted to give MinnEcon readers one more shot before we start posting.

If you ran the drill picking employer health care options for 2011, drop us a line and tell us how it went.

If you bought health care some other way or plan to go without coverage in 2011, we want to hear from you, too. Take five minutes and give us a quick sense of what you're facing.

The state of health care choices may tell us something about the state of the economy's overall health. More choices for 2011 than 2010 or 2009? Any perks returning? Costs higher or lower than you expected?

Last year when we asked similar questions, we got some pretty frank responses from people struggling to find affordable health care. Even in a well insured state like ours, a lot of the people were rolling the dice.

This year, I'm also wondering how the new national health care legislation will affect people. Kids can stay on a parent's coverage until age 26, free preventive care and no lifetime payout caps.

If you're taking advantage of any of the new provisions, post something below or contact us directly.

Comment on this post

Your 2011 coverage changing? Drop us a line

Posted at 10:49 AM on November 9, 2010 by Paul Tosto (0 Comments)
Filed under: Health care

Man, it used to be easy. Health Plan A or B. The differences weren't hard to understand.

I've been going through my options for 2011 health care coverage and so far it's not so bad. But it's always kind of a hassle, isn't it?

If you're in the middle of navigating your employer health care options for 2011 you're likely running the same drill. So drop us a line and tell us how it's going.

We'll share some stories and maybe make us all a little smarter.

About this time last year we asked Minnesotans in MPR's Public Insight Network to tell us about their options for 2010 and what else we should know about buying health care.

We got some pretty frank responses from folks struggling to find a health care answer in the Great Recession.

Kiplinger does a terrific package each year on open enrollment decisions. My favorite: "Five things to do during open enrollment."

This year, I'm also wondering how the new national health care legislation will affect people. Kids can stay on a parent's coverage until age 26, free preventive care and no lifetime payout caps.

Yes, I know it could be repealed. But it's the law currently. So if you're planning to take advantage of any of the new provisions, post something below or contact us directly.

Also, are you buying health care some other way or planning to go next year without coverage? Take five minutes and give us a quick sense of what you're facing.

BONUS: Click on the map icons to read what Minnesotans told us last year about picking health care.

Comment on this post

Understanding health coverage: a baby step forward

Posted at 9:11 AM on July 1, 2010 by Paul Tosto (0 Comments)
Filed under: Health care

Minnesota remains one of the best when it comes to citizens covered by a health plan. The recession, though, has hurt those good numbers. and we've had more than a few conversations with Minnesotans rolling the dice on health coverage.

Understanding what options are there isn't easy, especially with the new health coverage law..

A new federal web site may help change that.

At healthcare.gov, the feds have a page where you answer general questions about your household health insurance and it walks you through coverage options to explore and parts of the federal law that might help you.

The site still amounts to baby steps in the quest to understand health insurance. But it's a start.

It plans to add specific information on public programs like Medicaid, and private insurance plans.

Cost estimates on private insurance plans are expected in October and the feds say it will allow side-by-side comparisons.

I started playing around on the site this morning and found helpful ideas. No "Aha!" moment in understanding all that's out there. But still worth watching to see how they make it better.

Do you know a good, independent site that lays out health coverage options in a fair and understandable way?

Drop us a line and tell and we'll share it on MinnEcon.

Comment on this post

More nurses and patient outcomes

Posted at 3:28 PM on June 29, 2010 by Chris Farrell (1 Comments)
Filed under: Health care

From chief economics correspondent Chris Farrell

The clock is ticking on a potential Twin Cities nurses strike on July 6. The hospitals and nurses haven't been able to come to an agreement. A major sticking point in the negotiations is that the nurses union want hospitals to limit the number of patients nurses are required to care for during a shift. The hospitals are wary of agreeing to specific staffing ratios, especially since there are so many known-unknowns (to use Donald Rumsfeld's famous phrase) with the health care reform law.

Still, it makes intuitive sense that high nurse staffing ratios would be associated with better patient care and outcomes. A number of studies on the issue suggest that there's some insight to that common sense notion.

But an intriguing new study published by the National Bureau of Economic Research comes to a more skeptical conclusion. In The Effect of Hospital Nurse Staffing on Patient Health Outcomes: Evidence from California's Minimum Staffing Regulation, economists Andrew Cook (Resolution Economics LLC), Martin Gaynor (Carnegie Mellon), Melvin Stephens, Jr. (University of Michigan) and Lowell Taylor (Carnegie Mellon) look at the impact of California's 1999 Assembly Bill 394. It mandated maximum levels of patients per nurse in hospitals. The mandate went into effect in 2004 after several years of study and negotiation.

The scholars found that California's staffing requirement succeeded in decreasing the patient/nurse ratio in hospitals that didn't meet the standard before the law was enacted. However, they found no evidence that the higher staffing ratios improved patient safety at these hospitals. "Our empirical results suggest that a mandate reducing patient/nurse rations, on its own, need not lead to improved patient safety," they write. "This is not to say, though that nurse staffing decisions are unimportant as a component in a hospitals's overall strategy for ensuring high patient safety."

In other words, management and basic strategy matters.

To be sure, studies like this are never definitive. The data is always incomplete and flawed by definition. It's extremely difficult to establish cause and effect no matter how hard the scholars try. This isn't a criticism of the scholars. It's in the nature of the beast and the scholars are very forthright about the limitations of their study. Still, California's experience provides a real world case study and it's disappointing the results weren't better--that is, from a patients perspective.

It's worth noting that another NBER study found a dismaying but suggestive short-term patient consequences from a strike. I posted on that earlier.

Comment on this post

Which colleges produce the most nurses? A Minnesota look

Posted at 12:00 PM on June 29, 2010 by Paul Tosto (0 Comments)
Filed under: Health care, Jobs & unemployment

I spaced out completely yesterday while posting on the national data on schools that produce the most nurses. I didn't include similar data for Minnesota.

We'll make up for that today with a few graphics.

Below is data on students who completed a two year or four year RN track program in 2009 at a Minnesota-based college. The numbers come from the federal IPEDS database.

I focused on those two degree programs because they're the most likely to produce new nurses that add to the supply. (Some bachelor's programs target working nurses moving up the degree ladder and so don't add to supply.)

Here are the Minnesota institutions producing the most two year RN graduates:

And here are the major four year institutions:

(Thanks to Josh Wright from the research firm EMSI for pulling the IPEDS Minnesota data together for us.)

Here's a look from the Minnesota Office of Higher Education on the growth of bachelor's and associate's degree graduates from RN programs. It shows about a 50 percent increase in annual graduates over four years, from 2004 to 2008.

That jump has come in years (even before the recession) when statewide RN vacancies were relatively flat -- and then took a dramatic dive.

(Source: Minnesota State Colleges and Universities system)

There's no doubt the recession is to blame for Minnesota RN vacancies falling off a cliff in 2009.

Demand for new nurses in Minnesota will bounce back. But when does that happen? How will it affect the job choices for nurses, especially graduates from two year programs, in the short run?

Comment on this post

Which colleges produce the most nurses?

Posted at 1:09 PM on June 28, 2010 by Paul Tosto (0 Comments)
Filed under: Health care

If you've been following our rolling discussion on the supply of nurses from the college systems in Minnesota and the nation, you'll know that Josh Wright from the economic research group EMSI has been generating some very cool data.

On Friday, Josh published some intriguing stats from the federal IPEDs data on the schools that are producing the most registered nurses in the country.

Number one? Excelsior College, a distance learning and online university, which has become the largest nursing school in the country .

Excelsior is based in Albany, NY, but the college says one in 10 students pursuing an associate degree in nursing in the U.S. was enrolled in its school.

School number two? University of Phoenix, which has a program tailored for RNs seeing to earn a bachelor's.

Click on the chart below to examine the rest of the EMSI research.

My point? The market for new nurses is more complex than I realized when I first asked, What's the right number of nurses?

While I've been thinking in terms of supply of nurses from Minnesota colleges, the reality is this is a national and increasingly international business. Nurses are being trained in big numbers in schools across the country, tied only in a basic way to geography, making it.even harder to understand if we have an oversupply.

Thoughts and questions:

1.) What's the fate of two-year degree students? Do they get jobs, how long does it take and do they get the RN jobs they want (hospitals)?

Do they choose jobs in assisted care facilities for less pay and flexibility? There's a need there so that's not necessarily a bad thing, unless you were in mid-life and went back to college thinking a well paying, super-flexible hospital nursing job awaited and what you got wasn't as well paying or as flexible as what you left.

We're starting to see those concerns show up in the media. Here's a story from Lancaster, PA.

2.) How good are the colleges and the industry at managing supply? Like airlines that overbook because they know a certain percentage of fliers will not show, how good are the colleges and the industry at figuring a rate of students who won't pass their gateway exams into nursing or who'll become RNs but won't practice?

There's a legitimate argument that what I view as oversupply, the industry and colleges view as acceptable since a percentage of those new completers won't stay in nursing.

Still, if you take the national and international view, there are a lot more new nurses coming in to the U.S. market that there is projected demand.

Take a look at the NCLEX, the gateway exam to get a registered nursing job in the U.S.

Data collected by the National Council of State Boards of Nursing (.pdf page 19) show a total of 132,940 U.S. students passing the NCLEX exam for the first time in fiscal 2009. That's significantly higher than the 105,020 annual national need EMSI projects.

Now add in the number internationally educated students who took the NCLEX exam for the first time or repeated and you get a total of 148,266 nurses who passed the exam and are able to enter the health system work force as RNs.

So if the U.S. going forward needs 100,000 to 110,000 new nurses each year and if we have 148,000 total US and international students passing the NCLEX for the first time, every year....

I still can't reconcile that data.

Comment on this post

Too many nursing grads? A look at first-time test takers

Posted at 12:36 PM on June 21, 2010 by Paul Tosto (3 Comments)
Filed under: Health care, Jobs & unemployment

We spent a good chunk of last week examining the question: Are colleges producing too many registered nurses?

We heard from lots of people who say no, that the shortage of RNs is real and that the idea schools are producing too many is wrong or that any imbalance is simply a short-term blip caused by the recession.

Our audience has been great about passing on data to us. Much obliged. We'll have at least two posts on the issue this week.

Today, we look at Minnesota and national data suggested by a reader: The number and pass rates of students who take the NCLEX exam for the time to become registered nurses.

This is the gateway national exam that "measures the competencies needed to perform safely and effectively as a newly licensed, entry-level nurse." So as a measure of annual new supply of nurses, it's not bad. (As we'll also see, it's not conclusive!)

Let's look first at Minnesota data (.pdf page 20). The National Council of State Boards of Nursing reports that 2,939 students in Minnesota took the NCLEX RN test for the first time between October 2008 and September 2009. A total of 2,501 passed.

That likely underestimates the number of new nurses supplied annually, however. The national nursing group doesn't provide state-by-state data on repeat takers -- students who failed the exam once and tried again. Nationally, repeaters made up about 11 percent of the total pool of successful U.S. test takers.

So if we tack on 11 percent on to 2,501 we get about 2,776 students who passed the NCLEX in Minnesota in the most recent 12 month period available.

Here are the two estimates we have for the demand for RNs in Minnesota:
State officials project a need for about 2,400 new nurses a year through 2019.

EMSI projects 2,629 Minnesota RN openings per year though 2015.

The EMSI data suggests the supply of new Minnesota nurses matches up pretty well with projected demand, though the official state projections suggest an annual oversupply of about 17 percent.

If you step back, though, and look at the national and international supply of nurses, there's still reason to be worried.

The national nursing council data (.pdf page 19) show a total of 132,940 U.S. students passing the NCLEX exam for the first time in fiscal 2009. That's significantly higher than the 105,020 annual national need EMSI projects.

Now add in the number internationally educated students who took the NCLEX exam for the first time or repeated and you get a total of 148,266 nurses who passed the exam and are able to enter the health system work force as RNs.

Nearly all those international students come from countries where the council expects them to be licenses and in U.S. states and territories.

In fiscal 2006, that total number of domestic and international students passing came in at 128,154.

That's a big jump in just a few years.

The Bureau of Labor Statistics still views the overall job outlook for RNs as excellent and notes that "hundreds of thousands of job openings will result from the need to replace experienced nurses who leave the occupation."

The American Association of Colleges of Nursing says, "The United States is in the midst of a nursing shortage that is expected to intensify as baby boomers age and the need for health care grows. Compounding the problem is the fact that nursing colleges and universities across the country are struggling to expand enrollment levels to meet the rising demand for nursing care."

The national data, though, show the supply of students passing their gateway RN exam each year is significantly higher than the annual needs BLS and others are projecting.

So how do we reconcile the data? Drop us a line if you can do it.

Comment on this post

Too many nursing grads? A deeper look at data

Posted at 12:29 PM on June 18, 2010 by Paul Tosto (0 Comments)
Filed under: Health care, Jobs & unemployment

We continue to write and ask questions about the supply and demand for nurses. It's generated a terrific conversation at our site and at Economic Modeling Specialists, the research group that's been equally interested in the topic.

We don't have any definite answers. (If you do, drop us a line.) So in this post, we'll dive a little deeper into the data.

The EMSI researchers got the ball rolling when they created this chart showing the number of students completing a nursing program last year and their projection of annual registered nurse openings through 2015.

As we noted, there are lots of caveats, including the fact that the data counts people who are in nursing currently and moving up the degree ladder.

The EMSI guys then sent us the Minnesota data broken down by degree. The big number of 2009 nursing completers -- 4,271 -- includes associate's, bachelor's and master's, degrees for nurse anesthetist and public health nursing, etc.

We decided to look at associate's and bachelor's completers in 2008. Those are the folks most likely entering nursing for the first time.

That works out to 3,200 and matches up with data produced by the Minnesota Office of Higher Education.

Some of those bachelor's degree grads aren't new to nursing. Some bachelor of nursing science programs are designed for people who are already nurses and are simply adding to their knowledge, so they aren't necessarily adding to the supply.

So we'll lop 10 percent off the total and that brings us down to about 2,880, which is in line with the tally by the Minnesota Board of Nursing of all Minnesota program graduates preparing for registered nurse licensure in 2008.

So let's round off: 2,900 registered nursing grads in 2008. EMSI estimates Minnesota will need to add 2,600 nurses a year for the next five years. Minnesota state estimates put the new nurses need at an average of 2,400 a year through 2019.

Arguably, we can look at the data and conclude Minnesota schools are producing 300 to 500 more nurses a year beyond the projected need, which is pretty close to what we were talking about in our first post on the issue.

Let's assume the students entering the registered nurse job market with a bachelor's degree have an advantage over those with a two- year degree.

So if the oversupply falls completely on the 2,000 associate's degree completers, we're talking about 15 percent to 25 percent of associate degree completers who might have a hard time finding work.

I realize I'm in absolutely squishy territory.

In my work in journalism, I typically don't let the audience into my thought process. As you can tell, it's scary and vaguely incoherent.

But I think we ought to take a closer look two year programs.

We've seen a spike in the enrollments for two-year nursing programs. Are those grads viewed equally with bachelor's holders in seeking RN jobs? Could we end up with an oversupply of two-year degree registered nurses and a shortage of RNs with a bachelor's or higher?

In a post yesterday, EMSI highlighted an interview with Mary Bennett, director of Western Kentucky University's School of Nursing, who's been following the discussion. In her EMSI interview:

Bennett said graduates from WKU's baccalaureate program aren't having trouble finding jobs, but the issue might be at the two-year level.

"I think [the US is] probably at this point overproducing associate-degree nurses," she said.

*******************************************
We're going to look at the two-year issue in a post next week. If you're connected to a two-year program as a student, instructor, dean, whatever, we'd love to hear from you.

We're also looking for placement data for two year nursing school graduates, locally or nationally. If you have some for your school, please send it.

One last thing: an Alabama community college is offering nursing students a guarantee: If you don't have a job offer within six months of graduation, you'll get a full tuition scholarship for an additional 30 credits.

Comment on this post

Too many nursing grads? A closer look at two-year programs

Posted at 12:06 PM on June 23, 2010 by Paul Tosto (0 Comments)
Filed under: Health care, Jobs & unemployment

Our posts on the supply and demand for nurses are driving some good discussion. As always, tell us what you know and we'll make it part of the conversation.

Today, we turn the prism a bit to look at a new facet: Two year nursing programs.

As we drill down into the data on graduations and degrees, we're seeing how the recession and the promise of a well paying, flexible job in nursing are attracting lots of new students to two-year programs.

But there's also concern that the supply of nurses from those two-year programs is growing too fast.

"I think [the US is] probably at this point overproducing associate-degree nurses," said Mary Bennett, director of Western Kentucky University's School of Nursing, who's been following the discussion here and on the blog of the the research group EMSI.

Bennett told EMSI that graduates from WKU's baccalaureate program aren't having trouble finding jobs, but the issue might be at the two-year level.

Minnesota's public two-year colleges have seen a huge jump in nursing grads the past few years.

The numbers are higher if you look at the associate's and bachelor's degrees in nursing for all Minnesota institutions. According to the Minnesota Office of Higher Education, a total of 3,146 degrees were issued for associate's and bachelor's programs in the registered nurse category, a 50 percent increase from 2004.

At the same time vacancies for new nurses have plummeted.

(The charts were produced by the Minnesota State Colleges and Universities system, responsible for roughly 8 of every 10 nursing graduates from Minnesota schools. )

There's no doubt the number of openings will rise again with economic recovery. But that's a big drop in the past year or so and we don't have good data on how long it's taking to place new graduates of two year and four year programs.

We checked in with Janis Hollenbeck, interim dean of nursing and allied health programs at Minneapolis Community and Technical College.

She told us that MCTC pulled back its nursing admissions from 120 to 90 in the school year that just ended in response to nursing layoffs in the Twin Cities. For the fall, though, admission slots returned to 120.

She wrote:

MCTC reduced the number of admissions to the Nursing Program from 120 to 90 last academic year (fall semester 2009 - spring semester 2010). This was in response to layoff of Registered Nurses by Twin City hospitals that occurred during the previous academic year (fall 2008 - spring 2009).

All programs must be sensitive to the employment opportunities of their graduates and when local employment numbers reduce and/or layoffs within a vocation occur, institutions should be responding by reducing output of graduates in the area of reduction. That is what MCTC did in direct response to the layoff of RN's in the Metro area.

There have been no additional layoffs of RN's in the Metro area during academic year 2009 - 2010 and some rehiring of RN's and thus MCTC has responded by returning admission to the Nursing Program during academic year 2010-2011 to the former number of 120.

MCTC's program is unique in that students in the Nursing Program can attend part-time (most programs require full-time attendance by nursing students) and thus the 120 persons admitted in the coming academic year will graduate anywhere from 2 to 4 years in the future, and there is indication through a slightly improving economy, and the prediction of need for RN's, that there will be employment opportunity during the time frame when these students will graduate.

"My current reading, based on what December 2009 and May 2010 graduates are telling us, is that employment of new graduates is slow and graduates are participating in many interviews and applying for positions that are not their priority interest in order to gain employment in-field.

"The current metro area nursing labor dispute is further muddying the picture so it is quite difficult to know what to anticipate with regard to employment for new graduates."

As MinnEcon and EMSI continue to explore the issue of supply and demand in nursing, I'll admit I'm concerned about graduates from two-year programs.

Are their job prospects as good as RNs with a bachelor's degree or higher? Could we end up in a circumstance where there's a shortage of nurses with four-year degrees and an oversupply of nurses with associate's degrees?

Without complete data on placements, it's hard to know.

So the next step in our reporting is to try to talk to new graduates of two-year nursing programs about their experiences.

If you're a recent graduate of a two-year RN program or know someone who is, please contact us and tell us about the job market you've seen. We'll post your responses and add to the discussion.

**************************************
It's worth pointing out again that most experts dismiss the idea of an oversupply of nurses in the pipeline.

We contacted the National League for Nursing, a nursing education group, looking for job placement data for two year nurse graduates (we thought they kept that data but they did not.).

"What we do know from anecdotal evidence is that the current recession has encouraged many experienced RNs to work more hours and has brought retired nurses back into the labor force," said Kathy Kaufman, a senior researcher with the group, wrote us.

At the same time, economic pressures have forced many Americans to cancel elective medical procedures and to postpone non-acute medical care. As a result, in some regions and job markets newly licensed RNs are momentarily facing a difficult job market.

However, the underlying conditions that created projections of a shortage of over one million RNs by the year 2020 have not changed, and there is broad agreement among analysts that the tight job market for new RNs is merely transitory.

Those are people prepared to enter nursing for the first time. Will they all find work?

Comment on this post

Too many nursing grads? Two key views

Posted at 12:00 PM on June 17, 2010 by Paul Tosto (0 Comments)
Filed under: Health care, Jobs & unemployment

We have a great conversation rolling around the question: Are colleges over supplying nurses? The couple posts we've done are generating comments from Minnesota and across the nation with data and insights.

Please keep it going. We're doing a kind of cool, transparent journalism here as we grope for answers, and your vantage point is crucial. Tell us what you're seeing.

Researchers at Economic Modeling Specialists Inc. also continue to dig into the nurse supply issue with us, providing some great insights.

In this post, we'll highlight two important perspectives from experts who do not believe Minnesota colleges are over supplying nurses.

Jane Foote is executive director of HealthForce Minnesota, a public-private effort to boost the number of health care workers. Adam Suomala is director of member relations for Aging Services of Minnesota, a group that includes assisted living and care centers throughout the state.

"Everybody believes we're still going to be short nurses," said Foote, a former dean of nursing at Minneapolis Community and Technical College.

Looking at the data from our first post on the issue, Foote said, "The numbers don't really match up with what industry is telling us the needs are. We ask our employers that -- 'Are we preparing too many?' Their word to us is, 'Don't stop.'"

She characterized the current supply / demand situation as a "lull before the storm" as health care demands rise and Minnesota's aging nursing workforce begins to retire, although she did mention that one community college is scaling back its nursing enrollment for next fall.

The state's public two-year colleges have seen a huge jump in grads the past few years.

Foote, though, says the nursing programs are not money-makers for the state's community colleges and public funding covers about half the costs.

The challenge, she added, is that there's always a lag time between what employers say they need and the community colleges' ability to increase the flow.

Suomala made some great points in responding to our initial post. He wrote:

To date, the focus on the "right number of nurses" in Minnesota has been almost exclusively around positions in the hospital -- I would encourage you to look at the demographic "boom" of older adults hitting our healthcare system, and the many careers available today in older adult services... specifically skilled care centers, assisted living, and home care.

A common hope of emerging nursing graduates may be a day shift at Children's Hospital, but the reality is where Minnesota needs their service most is in the many expanding arenas serving older adults.

State officials, he said, refer to the wave as the "silver tsunami." The aging population will want more home and community-based services that may not be available "without a healthy workforce to do that work. "

Part of the challenge there, however, is convincing nurses to come to senior care, rather than hospitals. There is a pay gap with hospitals generally paying nurses better wages and offering more flexibility.

Suomala told us:

I was recently in a room full of unemployed nurses here in the metro. I asked them to raise their hands if they were looking for jobs in hospitals. They all raised their hands. I asked them who was considering a career in an aging services setting (care center, assisted living or home care, etc.). Only two hands stayed up.

Something simply has to change with the mindset of Minnesota nurses in the opportunities out there for jobs. Today and for tomorrow.

I can understand the frustration of a grad who can't get their dream position working the day shift with babies at Children's Hospital after graduation or living the life TV and film paint with shows like E.R. But that doesn't mean there aren't nursing jobs -- good jobs, rewarding jobs -- all over Minnesota today (and certainly in the future) in the field of aging services.

Comment on this post

Are colleges oversupplying nurses?

Posted at 12:00 PM on June 15, 2010 by Paul Tosto (27 Comments)
Filed under: Health care

With our aging population, it's been a given that health careers will be in high demand and that we have a huge shortage of nurses heading into the future.

But is that conventional wisdom wrong? We started asking that question last week as the Twin Cities one-day nurses strike loomed.

We highlighted projections from the research group Economic Modeling Specialists Inc.

Researchers there saw our post and did some more digging.

The result? Data that should have us all asking if the nation's public and private colleges are producing too many nurses.

Below is a chart EMSI created showing the number of students completing a nursing program last year and its projection of annual registered nurse openings through 2015. (Definitions are at the bottom of the post).

At first glance, it's jaw dropping -- Minnesota schools with nearly 4,300 students completing a nursing program last year with only about 2,600 openings expected annually through 2015. Nationwide, EMSI estimates an oversupply of more than 85,000 nursing graduates a year, with only Alaska and Nevada facing a shortfall.

Yes, there are caveats.

No data is perfect. The completions data from the federal government's Integrated Postsecondary Education System (IPEDs) don't indicate if those who completed a program went into nursing. It likely also counts people who are in nursing currently and moving up the degree ladder. It also assumes the projections are valid.

But I'm highlighting the EMSI research for a couple reasons. The Minnesota State Colleges and Universities system uses EMSI's projections. And EMSI is using IPEDs data, which is about as consistent as it gets.

As with our our first post, we don't have all the answers. We have some data and it's pretty compelling.

If you have insights or better data, let us know and we'll highlight it in future posts.

Later this week, we'll be posting from interviews with Minnesotans who follow nursing graduate trends, including Jane Foote of HealthForce Minnesota , a public - private effort to increase the number of workers in the state health system.

"The situation in most areas probably isn't as out of whack as the numbers suggest," says EMSI's Josh Wright.

"There are still lots of job postings for RNs and other more specialized nurses. But anecdotally, we're hearing more and more how nurses in certain areas can't find jobs. It's a complicated issue, but clearly there is a supply / demand imbalance -- as EMSI's data suggest."

Part of the problem is that no one collects all the data in one place in a form that's most useful. So we're still groping to understand the data and answer the question about the supply of nurses in the education pipeline.

It may not be a crisis but with the numbers in front of us now, it's an issue we need to probe.

*************************************
Here are the definitions for the EMSI data:

Completions: The number of students in a given year that completed a specific course of study as reported to the federal government
Integrated Postsecondary Education System (IPEDs), the federal government's

IPEDS accounts for all colleges and universities that participate or are applicants for any federal financial assistance program authorized by the Higher Education Act (HEA), which includes most of the well-known federal loans (e.g., Pell Grants, Stafford Loans). All public colleges and universities and a number of private postsecondary schools accept federal assistance loans and therefore are included.

Annual Openings: The sum of new and replacement jobs (see below) in the occupation over the entire selected timeframe (in this case 2010-2015), divided by the number of years in the timeframe. Just as a caveat: Our 2010 numbers are only partially projected, so we divided by five (2011-15).

Replacement Jobs: The number of job openings (over a given timeframe) expected in an occupation as the result of turnover--e.g., employees changing occupations, retiring, etc. It is derived by multiplying estimated annual turnover by the number of years in the given timeframe.

Comment on this post

Nursing -- A shortage or not?

Posted at 10:19 AM on May 21, 2009 by Paul Tosto (1 Comments)
Filed under: Health care

MinnEcon note: Here's a post from my MPR colleague Mike Caputo:

Mike Caputo | MPR News

North Memorial Health Care in Robbinsdale announced that it will either cut the hours or the positions of 170 people. The news comes a few weeks after Hennepin County Medical Center (HCMC) and Park Nicollet Health Services announced layoffs.

Since the recession started, Minnesota has cut 2,000 health care jobs.

And while institutions who are doing the cutting want to avoid the front-line workers, such as nurses, they are being nicked too. Park Nicollet cut 26 licensed practical nurses. HCMC has left nursing jobs unfilled and may be cutting some in this latest round. The Minnesota Nurses Association says that 100 of its members have lost jobs in 2009.

The layoffs are discouraging news to the 120 graduates from the University of Minnesota's School of Nursing. They grabbed their sheepskin on Friday. But only 25 of them have a job lined up.

Last year, all of the 130 or so graduates had jobs waiting for them when they graduated, said Connie Delaney, the U of M Nursing School dean.

Not long ago, hospitals were fighting over qualified graduates, offering hefty signing bonuses and other incentives to graduates.

Now students face competition for jobs, said Mary Rothchild of Minnesota State Colleges and Universities, whose graduates account for about 80 percent of the new nursing pool in the state. In addition, many graduates thought it would be no problem to get into prized areas such as pediatric or surgical care, she said. But that's no longer the case.

This reality seems to conflict with the conventional wisdom that nursing, and other health care-related fields, are a safe-haven in a recession.

Well, yes and no.

In the short-term there is a noticeable drop in job vacancies for nursing positions, according to state figures. But state labor experts say the demand for nurses still beats that of most any other profession.

And, in the long-term, the need for more nurses will be great. Delaney says the explosion of medical need for baby boomers coupled with the advanced age of licensed nurses in Minnesota still means there will be a coming crisis in meeting the nursing demand in the future.

And she doesn't back off from the word - crisis.

So what should nursing applicants do?

Delaney and Rothchild say applicants should be flexible - take jobs in nursing home environments or in geriatrics. They should consider information health technology or be willing to move to other parts of the country to land positions.

Comment on this post

What's the right number of nurses?

Posted at 12:00 PM on June 9, 2010 by Paul Tosto (2 Comments)
Filed under: Health care, Jobs & unemployment

Thousands of Twin Cities nurses on Thursday plan to stage a one-day strike. Staffing levels make up one of the fault lines in the talks over a new contract.

I don't want to dive into the specific staffing issues surrounding the strike. But it has me thinking about a question I've worried about for more than a year: What's the right number of nurses?

With our aging population, it's been a given that health careers will be in huge demand and that nurses, the people we rely on most in the health system, will be crucial.

It's also been a given that we have a huge shortage heading into the future. But is that the case?

MinnEcon raised this issue last year when local hospitals were laying off nurses. It seemed like the market was all out of whack: nurses losing jobs while new nursing school graduates struggled to find work while record numbers of students continued to enroll in nursing programs.

The conclusion then was that it was simply a short term problem triggered by the recession. And yet:

The number of registered nurse job vacancies in Minnesota has plummeted, from 2,237 in 2008 to 536, according to data collected by the Minnesota State Colleges and Universities system (Click on the chart for a larger view).

At the current rate, the market is producing more nursing grads than the system needs. MnSCU data show "the total supply of new nurse graduates at the professional-level (RN) from both public and private institutions has increased over the past nine years. In 2008 it reached 2,800."

The state Department of Employment and Economic Development estimates about 2,340 openings for registered nurses each year between 2006 -2016.

Another group, Economic Modeling Specialists Inc., projects a need for about 2,577 nurses a year through 2019, according to MnSCU.

Between the two estimates, Minnesota schools are producing 9 to 19 percent more nurses than the state's projected to need.

Of course, not all of those grads will stay in Minnesota. But grads outside Minnesota are also likely to seek work here.

As my colleague Mike Caputo noted last year, in 2008, all of the 130 baccalaureate graduates of the University of Minnesota nursing school had jobs waiting for them at graduation, In 2009, only 20 percent graduated with a job in hand.

This year, about one third of the nursing school grads had jobs, said Connie Delaney, dean of the U's nursing school.

"As with last year, we expect all to have jobs within months," she said. "Although health care needs are high, the financial pressures on our health system are impeding its ability to address these needs," affecting when graduates get hired.

Another complicating factor in trying to manage supply and demand here is that Minnesota has one of the country's highest rates of part-time nurses.

A 2004 federal survey estimated 44 percent of Minnesota's RNs worked part-time. Only Vermont, with 45 percent, was higher. The national average was 30 percent.

MPR's Lorna Benson, who writes on health issues and has been covering the contract talks, told me:

A few of the nurses I've talked to told me that they work part-time because it gives them more control over their schedule. So for example, a nurse might willingly accept a two-day per week shift because it's easier to take vacations or plan things outside of work. They said nurses who work full-time have a very difficult time scheduling time off.

The part-time jobs come with benefits (you must work a minimum of 16 hours per week) and part-time nurses also have the option of picking up extra shifts at their discretion.

Some nurses still end up working a full 40 hours per week even though they are part-time.

So what do we have?

We see a huge push into nursing because of the perceived future need. It's coming especially from MnSCU's two-year degree programs. It's been accelerated by the recession.

We have a market that's been able to handle high numbers of new nurses because many here choose to work part time.

But will that structure stay in place in the future? If more Minnesotans enter nursing programs expecting or needing full time work, what happens to the market then?

I'm laying out data and raising the issue not because I have answers but because we need a conversation about how many nurses the market can handle.

It's an issue that's popping up in other places this graduation season.

So take a look at the data and what I've written and answer the questions: What is the right number of nurses? Are we correctly supplied for the future?

Post something below or contact me directly at MinnEcon.

Comment on this post

The steep price of being healthy

Posted at 2:44 PM on May 17, 2010 by Chris Farrell (0 Comments)
Filed under: Health care

From chief economics correspondent Chris Farrell

This comes under the category of economic life isn't (necessarily) fair.

Specifically, the Center for Retirement Research at Boston College is out with a new study that makes an important, but greatly underappreciated point about health care spending. The current health care costs of unhealthy retirees are higher than that of healthy retirees. No surprise there, right? Here's the rub: Healthy retirees actually face higher total health care costs over their remaining lifetime.

In Does Staying Helathy Reduce Your Lifetime Health Care Costs? scholars Wei Sun, Anthony Webb, and Natalia Zhivan illustrate the basic idea with this example. They estimate that the lifetime health care costs for a couple turning 65 in 2009 in which one or both spouses suffer from a chronic disease is $220,000. The figure includes insurance premiums and the cost of nursing home care. And 5 percent can expect to spend more than $465,000. (Chronic diseases include diabetes, cancer, lung disease, heart disease, and stroke.)

The comparable numbers for a healthy couple free of chronic disease are substantially higher, at $260,000 and $570,000, respectively.

What's going on? The basic reason is that someone free of chronic illness will tend to live longer and, therefore, incur greater health care expenses over their lifetime compared to someone suffering from chronic illness. For one thing, a healthy 80 year old has a remaining life expectancy 29 percent longer than an unhealthy peer. For another, folks that make it to age 80 free of chronic diseases can still expect to spend a third of their remaining years struggling with one. Finally, healthy people are at much greater risk of living long enough to end up in an expensive nursing home.

The personal finance implication: If you're aging and healthy don't assume that you won't have to tap deep into savings to meet steep health care bills. (This is not a brief against good health, byt the way.)

The public policy inference is the common perception that the one way to reduce health care expenditures is to drastically cut down on obesity, diabetes, and other severe health issues is probably wrong. Success agaisnt disease may well mean that we spend much more on health, not less.

But is a cause for celebration. It's a good thing if we end up reducing chronic diseases and spending even more of our wealth on health care. A healthy society could be a more expensive society, but it will also be happier and more productive. In other words, we can afford to be healthy.

Who says economics is a dismal science.

Comment on this post

Your six word health stories. Mapped.

Posted at 12:00 PM on April 15, 2010 by Paul Tosto (1 Comments)
Filed under: Health care

We asked you a few weeks ago to sum up your experiences with health care coverage in six words. You boldly took up the challenge.

We were overwhelmed with responses -- more than 120 from Minnesotans who shared their stories of success and frustration (mostly frustration) searching and paying for affordable health care.

Or going without. Minnesota has one of the highest rates of citizens covered in the nation, but we're still seeing people rolling the dice.

Nutritious food's expensive - that's OUR insurance.

That's how Jennifer Bezek of Watertown summed up her health care story. She told us:

Last spring my husband's coverage through work was to be bumped up to over $750 per month, while the employer payed $250 ($1000 total), and there are only two of us! This was beyond our budget, so he dropped our coverage, and a month later he was laid off.

Since then we have invested more time and money in our organic garden, but we are not able to grow and preserve all we need. Nutritious food and supplements are not cheap, and we find we have nothing left over for sick care insurance. So OUR health care insurance is our own common sense, research and hard work.

Until one or both of us are able to find gainful employment, this preventive effort will have to suffice!

View Your Health Care Story in Six Words in a full screen map

The recession has hit middle-income families particularly hard. Many people had coverage through their employer. Losing a job means going without or shouldering expensive coverage on your own. More than 100,000 Minnesotans went without coverage in 2009 compared to 2007.

"High-deductible HSA. Fear major illness."

Tammy Woodhouse of Minneapolis works at a small business. "After a layoff that cost us group coverage, we enrolled in a high-deductible HSA (health spending account) plan. Premiums and out-of-pocket expenses amounted to 15% of our gross income last year. For that, we received 4 well visits, 4 sick visits, labs and prescriptions."

"The financial implications of a major illness are terrifying," she added.

"If we earned less, we'd be richer!"

That's how Julie Pfoser, a homemaker from St. Paul, summed up the dilemma.

"I was previously an insurance professional, but left the field to be a stay-at-home mom to our 3 children. My husband gets insurance through work, and we pay more than we can afford for private coverage for the kids," she said.

"I have been without health care coverage for close to 4 years. We make too much money to qualify for any kind of state assistance, but not enough to be able to afford coverage on our own."

Here are my six words: Job questions: Prior conditions covered? Affordably?

Those were vital questions when I took this job a couple years ago. One of my kids has significant health needs. Happily, the answers were yes. But those questions will drive my employment decisions for a long time to come.

I'll be following up with many of the folks who've shared their stories to learn more for future posts.

Click on those map icons above and you'll get a good sense of what your neighbors are going through. You may see yourself there, too.

If not, share your story.

Comment on this post

Strikes and patient care

Posted at 3:57 PM on April 12, 2010 by Chris Farrell
Filed under: Health care

From chief economics correspondent Chris Farrell

Paul is closely monitoring contract negotiations between 12,000 nurses and 6 hospital systems in the Twin Cities. There is talk of a strike, although it's unclear how real the risk is that bargaining will actually break down before the contract ends on May 31.

Still, what is the potential impact of a hospital strike on patients? That's the question investigated in a recent National Bureau of Economic Research (NBER) paper, Do Strikes Kill? Evidence from New York State by economists Jonathan Gruber of MIT and Samuel A. Kleiner of Carnegie Mellon. (Gruber is among the nation's leading healthcare economists; his research is always worth reading.)

They note that concerns over patient welfare excluded hospitals from collective bargaining laws for almost three decades after other major sectors of the economy could unionize. Collective bargaining became permissible in 1974. Hospitals are now among the country's most unionized industries.

To attempt an answer, Gruber and Kleiner gathered data on every hospital strike over the 1984 to 2004 period in New York State. They then matched that data to a hospital discharge database that provides information on treatment intensity, patient mortality and hospital readmission. They also controlled for a number of factors, such as patient demographics and disease severity.

Their results are arresting, although it's in the nature of a limited study like theirs that the conclusions are suggestive rather than definitive. They estimate that nurses' strikes increase in-hospital mortality by 19.4% and the 30-day readmission rate by 6.5% compared to patients admitted at nearby non-striking hospitals over the same period. The deterioration in patient care is only during the strike period. It doesn't happen before or after the strike at the same hospital. "Overall, our findings suggest that strikes lead to lower quality of medical care in hospitals."

The scholars are careful to say that their research focuses on the short-term negative impact of a strike on patients. They note that other research studies have shown that union-related workplace initiatives have contributed to long-run hospital productivity and the quality of care. (The paper is behind the paid subscription firewall at the NBER. I didn't find it elsewhere. You can find the abstract here.)

The authors call for more research and, in this particular case, they're right.

Three things I learned this week

Posted at 12:00 PM on April 2, 2010 by Paul Tosto (0 Comments)
Filed under: Health care, Housing & mortgages, Jobs & unemployment

1.) The $14 billion in taxpayer money spent funding home buying tax credits may not be worth the cost. Economist Louis Johnston raised questions that I hadn't thought about before, including: Are the credits just an attempt to re-inflate the housing bubble?

If that's the case, the housing value roller coaster ride isn't over yet.

2.) New, well intended plans to help unemployed people modify their mortgages and avoid foreclosure will likely provide little help.

There are sweeteners to boost payoffs to second mortgage holders and that may help get short sales moving.

But Realtor Carrie Newhouse, a source in MPR's Public Insight Network who does a lot of short sale work, told us the efforts are mostly creating "false hopes" for many.

3.) Your health stories. Oh my goodness.

We asked MinnEcon readers and Minnesotans in our Network to sum up their health care and coverage experiences in six words.

Once again, you were honest, creative and compelling. More than 100 people responded and I'll be following up with many of you in coming weeks to see if you'd be willing to talk in greater detail.

Some samples:

Housing or insurance. Can't afford both.

Great insurance. Horrible care. Life outstate.

This one came in this morning. It's more than six words but still gets to the point.
$6,000 deductible. Choose between children. OR Choose between children. What to do?

We're still looking for stories. Share your six words here (OK, it can be a little longer).

Here are my six words: Job questions: Prior conditions covered? Affordably?

What did you learn this week about Minnesota's economy? Post below or contact me directly.

Comment on this post

Your health care story in six words

Posted at 10:00 AM on March 29, 2010 by Paul Tosto (18 Comments)
Filed under: Health care

You sent in tons of great responses to the challenge last week to write your recession story in six words.

You made your points quickly and creatively. So we're going to try some more in the coming weeks and we'll be sharing them with our public media colleagues across the country.

This week, tell us your health care story in six words.

We're thinking about coverage and cost issues given the recent passage of the massive health care bill. But you can use the words to sum up any insight or experience with insurance or care.

Here's my six-word health care memoir:
Job questions: Prior conditions covered? Affordably?

Those were vital questions when I took this job a couple years ago. One of my kids has significant health needs. Happily, the answers were yes. But those questions will drive my employment decisions for a long time to come.

Now you give it a shot. Share your six words here (it can be a little longer, I suppose) or post something below.

We'll share them in future posts and with our public media friends across the country at economystory.org

Here are some they've posted already.

"Clueless until I lost my job."

$12,000 A Year is Too Much.

Realizing we're very lucky. Fingers crossed.

NOTE: Our efforts were inspired by SMITH Magazine's ongoing Six-Word Memoir project.

Comment on this post

Jobs and trade

Posted at 4:46 PM on March 12, 2010 by Chris Farrell (0 Comments)
Filed under: Health care, Jobs & unemployment

From chief economics correspondent Chris Farrell

Paul's recent post on jobs versus the environment reminded me of a classic political economy problem deeply embedded into the whole discussion of freer trade.

The case for freer trade and open markets is overwhelming. Economic evidence and economic history alike support the view that freer trade over time invigorates economy's by encouraging the spread of new ideas, new technologies, and new ways of organizing everyday life (to paraphrase economist Joseph Schumpeter). Consumers enjoy lower prices and greater choice. Competition from overseas rivals encourages corporate efficiency and innovation.

Here's the thing: The benefits of a free trade and open border policy come with a considerable price tag. Not everyone benefits. As everyone who took Economics 101 knows, the gains from trade are dispersed throughout the economy while the costs are highly concentrated. Too many employees have felt the downside of "creative destruction." Thanks to the routine corporate restructurings, downsizings, reengineerings--pick your favorite euphemism--during good and bad times (like now), there's little job security and stagnant wages.

Combating the downside doesn't mean adopting protectionist measures. (Just ask the 1930s protectionists Messrs. Smoot and Hawley or look at the experience of Cuba and North Korea.) But let's agree on that and move on.

Instead of writing editorials and Op-ed pieces extolling the virtues of free trade, the economics profession should declare victory. The free trade debate has largely been won even though sometimes its two-steps forward and one-step back. Economists and other interested in the issue should focus more of their intellectual firepower on coming up with ways to support workers dislocated by international competition, deregulation, and technological innovation. In an era of high job loss, unemployment, wage stagnation, long-term unemployment, and underemployment, unaffordable or unavailable health insurance, and increasingly at-risk pension plans the truly important questions involve constructing a better safety net for workers (and not their companies). Healthcare reform is one potential step in the right direction. But much more needs to be done.

This way, the benefits of free trade are enjoyed and the downside minimized.

Comment on this post

Rolling the dice on health coverage

Posted at 12:00 PM on February 8, 2010 by Paul Tosto (3 Comments)
Filed under: Health care

"Who are these people?"

If you can afford health insurance, that might have been your first reaction to the news Friday that another 100,000 Minnesotans went without coverage in 2009 compared to 2007.

Dive into the report detail and you'll see, increasingly, it's a portrait of middle income Minnesota.

Those with the lowest incomes were still far more likely to be without coverage. But there was a big jump in people in the upper middle income range, "an indication that the economic downturn has not bypassed groups that typically have low rates of uninsurance," the state Health Department noted.

The department identified that group as having family incomes 300 to 400 percent above the poverty level of $22,050 for a family of four. That puts those family incomes at about $66,000 to $88,000.

The median family income for a family of four in Minnesota is $86,637, according to Census data.

Also, the percentage of uninsured college graduates rose from 2.4 percent in 2007 to 4.5 percent last year.

Maybe most concerning: The percentage of Minnesotans who said they got insurance from their employer dropped to 57 percent, down from 63 percent in 2007 and 2004.

Given the job hit Minnesota's taken in this recession, that drop makes sense. But if you're not working for an employer offering an affordable plan and you earn too much to qualify for public subsidies, the cost is brutal.

"Paying for health insurance is just not even a remote possibility right now," Pamela Nelson of Shoreview, a source in MPR's Public Insight Network, told us back in November. The cost of the best health plan option available to her family was the equivalent of buying a new car every year.

"Here's the 'least expensive' option for our family of 4, since we do not qualify for MN Care or Medicare and do not work for employers who offer health insurance benefits: $600/month for a $10,000 deductible (catastrophic) plan...we would basically pay $17,000/year before their 80/20 coverage would even kick in.

"Lower deductible plans cost considerably more up front/monthly." She and her husband are independent consultants, "underemployed currently and do not qualify for unemployment," she told us then.

We're checking in with Nelson today to see if things have changed and we'll post any updates. But the Health Department data confirms that more families like hers are rolling the dice on coverage.

****************************************************
Got a perspective or a different take on the Health Department report? Are you happy with your insurance coverage options? Post below or contact me directly.

Comment on this post

Is your health care deal better than the House plan?

Posted at 8:01 AM on November 12, 2009 by Paul Tosto (0 Comments)
Filed under: Health care

It's taken me a ridiculously long time to convert numbers from a .pdf document and put them into charts. But below are the numbers the Congressional Budget Office generated on the costs of the subsidized health plan proposed in the House health care reform bill.

Take a look and let me know how it compares to what you pay now, either in total dollars or percent of income. Is it substantially different than what you pay now? If you don't have insurance, how much of your income would you have had to pay to get basic coverage? You can post below or contact me directly.

For comparison's sake, the Kaiser Family Foundation estimates the premium for employer-sponsored family health coverage in Minnesota ran $13,639 last year.

In the House bill, a family earning $78,000 would pay $8,800 in premiums, get a $500 subsidy, and have about $5,000 in co-pays for a total of $13,800 or 18 percent of income.

Caveats: These are averages and estimates for the regulated, subsidized health insurance exchanges called for in the House bill. It's a snapshot of expenses for a low-cost plan in 2016. "Cost-sharing" is essentially a co-pay. It's all subject to change and will change as the Senate takes it under consideration.

Family of Four

Single person

Again, numbers are subject to change. Compared to a Senate Finance Committee version, CBO notes the House bill "restricts more sharply the extent to which premiums can vary by age, which would make the exchanges less attractive to younger people (who tend to have lower health care costs) and more attractive to older people (who tend to have higher health care costs)."

Comment on this post

Health care overhaul: Will the solutions fit the needs?

Posted at 8:30 AM on November 9, 2009 by Paul Tosto (0 Comments)
Filed under: Health care

For the first time in my life, I think, I watched C-SPAN on a Saturday night. I watched the vote on the massive health care insurance overhaul.

I don't know what to make of it and I'm still unsure if the final product (the Senate will take a crack at it next) will match up with what Americans say they need.

The House bill has a lot of stuff. According to the Congressional Budget Office:

Among other things, the legislation would establish a mandate for most legal residents of the United States to obtain health insurance; set up insurance "exchanges" through which certain individuals and families could receive federal subsidies to substantially reduce the cost of purchasing that coverage;

establish a public plan that would be administered by the Secretary of Health and Human Services; significantly expand eligibility for Medicaid; substantially reduce the growth of Medicare's payment rates for most services (relative to the growth rates projected under current law); impose an income tax surcharge on high-income individuals; and make various other changes to the federal tax code, Medicaid, Medicare, and other programs.

CBO says it will be be a deficit reducer over the long run.

But I'm perplexed by a CBO letter that shows some really high costs for subsidized health care under the House bill.

Although premiums under H.R. 3962 would vary by geographic area to reflect differences in average spending for health care and would also vary by age... the approximate national average for that lower-cost reference plan--about $5,300 for single policies and about $15,000 for family policies in 2016. (emphasis mine)

That's a lot of money for an affordable plan.
11/12 UPDATE: While I quoted the CBO correctly I didn't realize the bill also included subsidies to bring down the costs. Click here for a deeper look at the data.

Democrats in their public statements have been noting, that's a lot lower than it would be with no action. . They've recently been using one key statistic: "One recent projection estimated that health insurance premiums in 2016 will be over $8,000 for individuals and over $24,000 for families if health reform is not enacted.

That $24,000 figure, however, doesn't come from the CBO. It comes from a think tank called the New America Foundation.

The crucial question is whether legislation will make health coverage affordable for people who can't afford it now. Does the House bill really do that?

Let's compare documents. Post below with links to documents that convince you the House health care reform legislation is right on target or completely off base. You can also contact me directly with some thoughts.

************************************************
MPR and the investigative reporting outlet ProPublica queried thousands of Americans earlier this year to find out where the health care system is succeeding and failing. More than 500 people responded.

Check out the responses mapped below, then add your own story.

Comment on this post

Picking health coverage for 2010? Good luck

Posted at 4:00 PM on November 5, 2009 by Paul Tosto (0 Comments)
Filed under: Health care, Saving & spending

Man, it used to be easy. Health Plan A or Health Plan B. The differences weren't hard to understand. Most of the time you just picked the same plan and that was fine.

If you're in the middle of navigating your employer health care options for 2010 you're likely longing for the old days. We asked Minnesotans in MPR's Public Insight Network to tell us about their options for 2010 and what else we should know about buying health care.

We got an earful back. Some folks love their choices. Others are trying some novel combinations. Some are rolling the dice -- going uninsured. (Add your voice.)
Click on the map icons to read the stories.

Nationally more than four in 10 employers surveyed plan to boost deductibles, copayments and out-of-pocket maximums in2010 due to the economic crisis, according to the consulting firm Watson Wyatt.

While they're adding incentives to stay healthy, employers are also pressing consumer directed health plans to control costs. These plans typically offer lower-premiums and a health savings account but with very high deductibles.

Al Heebsh, a Network source and chemist from New Brighton, says his employer is "making a concerted effort to get people to choose a consumer directed plan rather than a more traditional plan. They increased premiums a little for the traditional plan while decreasing the premiums for the consumer directed plan significantly..."

He's not sure yet which one he'll choose. "The consumer directed plan is more complicated, almost as if they are trying to confuse you into using less health care. I would rather have the traditional plan."

Sometimes having everyone on the same plan isn't the cheapest.

"My employer is now offering coverage for "Employee + Children" rather than just Employee OR Family coverage," Amanda Kelly, a Network source from Hanover told us.

"This means that we can save money by having my husband go it alone on one of the plans offered at his company and myself and the kids will be on my company's insurance plan. The employee + children option is MUCH cheaper than family coverage."

The New York Times and Kiplinger's recently put together some good advice to help in the decision making.

If you've been put out of work, the U.S. Labor Department has some surprisingly readable information on your rights and options re: health coverage.

That assumes, of course, you can afford it.

Pamela Nelson said the best health plan option available to her family is the equivalent of buying a new car every year.

"Here's the 'least expensive' option for our family of four, since we do not qualify for MN Care or Medicare and do not work for employers who offer health insurance benefits: $600/month for a $10,000 deductible (catastrophic) plan...," says Nelson, a Shoreview consultant .

We would basically pay $17,000/year before their 80/20 coverage would even kick in. Lower deductible plans cost considerably more up front/monthly. Both of us are independent consultants underemployed currently and do not qualify for unemployment. Paying for health insurance is just not even a remote possibility right now...

**********************************************
Got a health care plan for 2010? Like your options? Post below or click here and tell us.

Comment on this post

Health Care Handcuffs

Posted at 3:16 PM on August 17, 2009 by Paul Tosto (0 Comments)
Filed under: Health care

Here's a post from Public Insight Network editor Andrew Haeg:

One aspect of the health care debate that's gotten lost in the ruckus is the economic argument for health care reform--an argument that transcends party lines. It's on our minds because of a storyline we're hearing repeatedly from self-employed Minnesotans in the Public Insight Network, like Mark Long of Minneapolis.

"The first thing you ask yourself before you start a business," Long says is "not will someone buy my product or service" but, "can I afford health care?"

Less than half of small businesses with three to nine employees offer health care, according to research from the Council of Economic Advisors. Those small companies that do manage to provide the benefit, pay on average 18 percent more per worker than larger companies, says the same study.

The burden is getting heavier for Long. He and his wife are barely able to afford their health care plan, which has risen an average of 10 percent a year. Thankfully, they're healthy and, right now, they have enough to pay for their high-deductible plan. But not for long.

"We will close our business and find jobs that offer health coverage if nothing is done to curb costs in the next 10 years," he says. And that's without any major, unexpected health issues.

We've heard from several self-employed Minnesotans who are seriously considering leaving the land of the scrappy and self-employed. Less than a year ago, John (not his real name, he requested anonymity so his current employer wouldn't find out) had to quit working as a self-employed consultant in Plymouth when he found out he had inflammatory bowel disease. John said the move was all about risk management. He was covered by his wife's plan (and still is) but worried that if something happened to her job, they would be in big trouble.

"Closing my consulting business and getting a job was a way of hedging my bets," he says.

That sort of risk calculus is, at least anecdotally, forcing more self-employed to make similar decisions. The net effect is that, as Mark Long says, "The cost of health care absolutely is crushing innovation and entrepreneurship."

For yet more evidence, Consider Jenn Posterick of St. Francis. She runs a small massage business, but is sidelining her business and urgently looking for full-time work so she can get health care benefits.

"Ironic," she says, "that I care for other people but have a hard time caring for myself."

Comment on this post

The crossroads of pay for health care professionals

Posted at 2:55 PM on August 24, 2009 by Paul Tosto (0 Comments)
Filed under: Health care, Jobs & unemployment

Here's a post from my colleague Mike Caputo:

How could the direction of health care reform affect the pay and satisfaction of physicians and other clinicians, like nurse practitioners, in Minnesota?

Well, if the current proposal stands, and little change is done for compensation, then a glimpse might come from Mary, who is part of our Public Insight Network, and works for rural Minnesota health care organization (she didn't want to publicize her last name or her place of employment because of the tenuous nature of her contract negotiations).

She gets paid a straight salary for her work as nurse practitioner. Mary's contract is up for renewal, and they now want to pay her on a fee-for-service basis. Think of that as being paid on the volume of work she does, patients she sees and she procedures performed.

This bothers Mary.

"I will be expected to see more patients, work harder, stay later," she says. "I hope I don't drop dead in the process."

Some who want to reform health care say the fee-for-service approach is the culprit for much of what ails the system. Institutions can earn more by seeing more patients more quickly or by performing more expensive procedures.

It's an approach that Minnesota has traditionally gotten away from, says Dr. Doug Wood, the chairman of Mayo Clinic's health care policy and research. Wood says Mayo and HealthPartners led Minnesota away from fee-based incentives and instead offered their providers salaries, sometimes with a bonus based on a measure of quality care, That departure has helped Minnesota become one of the lowest-cost states in the nation (look at this comparison of Medicare costs by the Dartmouth Atlas).

Steve Parente, director of the University of Minnesota's Medical Industry, says Minnesota's health care culture has traditionally been more "collectivist" than in other states. (Interestingly, Parente attributes this to the European influence of the long-ago immigrants to this state. It could also stem from the influence of agriculture in the state, says Dave Renner, director of policy development at the Minnesota Medical Association, which represents physicians.)

You might think Minnesota's more collectivist approach would mean less money for docs, and perhaps fewer incentives for new physicians to move to the state. Wood said it was initially a struggle, but it's become easier to attract younger doctors in recent years because they care more for lifestyle than compensation. And they gravitate to organizations where they don't feel like a factory worker.

Which brings us back to Mary. She likes getting paid a salary, as does another Public Insight Network source, Philip Araoz, a radiologist at Mayo.

"I get paid the same as all radiologists regardless of what I'm performing," says Araoz "I'm not encouraged to do more (procedures) just to do them."

Mary's experience raises the larger question of whether health reform will make the rest of the country's health care system more like Minnesota. From what we can tell, the answer is no.

The actual legislation, at least the version approved by the House, only directs the Secretary of Health and Human Services to try some pilot programs where payments are based more on the quality of care than by the procedure.

Comment on this post

What happens when you're a farmer without good health coverage?

Posted at 8:00 AM on October 16, 2009 by Paul Tosto (0 Comments)
Filed under: Greater Minnesota, Health care, Small business

Good health coverage became a luxury for many small businesspeople in this recession. So imagine owning a small business in one of the nation's most dangerous sectors.

That helps to understand the results of a new report showing the consequences of medical debt carried by some family farmers in Minnesota and six other Midwest states.

Health coverage was one of the top concerns during our recent online forum featuring entrepreneurs from MPR's Public Insight Network.

But it creates a special kind of burden for farmers. Many rely on off-farm jobs as their source of health coverage. The danger inherent in agricultural work can make good coverage expensive and force some hard choices.

"There are no fair/affordable options for farmers and other self-employed persons to access affordable health insurance or health care. Why not?" Kenyon farmer and Network source Rae Rusnak asked us last winter.

Rusnak, a widowed single parent, has insurance but told us recently,

If I take a full-time off-farm job in order to get health care benefits, then my farm business will suffer, I will have to pay child care costs, and I will not get to spend as much time with my child. I choose to be with my child and pray that my health insurance rates do not go any higher. We are already experiencing the sting of high orthodontist bills.

Another Network farmer, Gary Brever of Parkers Prairie, said he's on MinnesotaCare, subsidized coverage for low- and moderate-income families.

"I'm very appreciative that we are elgible," he said. "Over the next year our farm income may rise to the point where we may have to pay increasing premiums but for all I know we will still be elgible for health care through MNCare. I have not looked into alternatives if our coverage is dropped."

Brenda Jannsen, a small beef and dairy farmer in southeast Minnesota told us several months ago her family was considering quitting farming -- health care was one of the major reasons.

Sadly, that's coming to pass. Jannsen told us a few days ago they've begun to sell off the dairy herd.

*********************************************************************
MPR and the investigative reporting outlet ProPublica queried thousands of Americans earlier this year to find out where the health care system is succeeding and failing. More than 500 people responded.

Check out the responses mapped below, then add your own story.

Comment on this post

Life as a small business person | the forum

Posted at 9:41 AM on October 14, 2009 by Paul Tosto (0 Comments)
Filed under: Health care, Small business, Twin Cities metro

In early September we brought together nine Minnesota small business people from MPR's Public Insight Network to talk about health care, finding credit and the pains and passions of running your own shop in this economy.

My colleague Mike Caputo took it another step, pulling together a face-to-face forum on small business issues. The result was a fine discussion you can hear today at noon on MPR's Midday program.

Below is the online forum. Listen in today at noon.

If you have a view on small business or want us at MinnEcon to look deeper at an issue, contact me.

Comment on this post

Health coverage: Coping with COBRA

Posted at 1:56 PM on March 12, 2009 by Paul Tosto (0 Comments)
Filed under: Health care

What will I do for health insurance? When you lose your job it's one of the first questions that come to mind. The answer is often COBRA, the federal legislation with the bad acronym that can keep you afloat. But, as more people are discovering these days, it is no deal.

Basically, if you get health coverage from a business with 20 or more workers, COBRA allow you to continue that coverage for 18 months (36 months in some cases) if you're cut from that job. But you shoulder the costs and it's expensive.

Mary Mulherin, part of Minnesota Public Radio's Public Insight Network, explained:

"COBRA went to $728 for single coverage so I had to drop it since I've been unemployed since last May, don't qualify for unemployment insurance and just couldn't afford to pay rent, food AND health insurance."

Mike Carey sees it from another angle. He's a human resources director at a large local consulting firm forced to lay people off after pay cuts weren't enough:

"The people we have let go in the past six months are still unemployed and really struggling. The cost of COBRA is a huge problem for those with families."

There's also potential coverage with MinnesotaCare, but as MPR reporter Martin Moylan reported recently, the guidelines for MinnesotaCare are tight:

"For a family of three, for instance, household income can't exceed about $48,000 a year. Assets, except home and retirement funds, can't exceed $20,000. Even then, you can't get covered by MinnesotaCare unless you've gone without insurance for at least four months."

The federal stimulus law provides some COBRA relief, including a 65 percent cut in premiums for up to nine months. But that won't help people who couldn't afford COBRA when they got cut and decided to go without coverage.

Notes Mulherin: "...for those of us who couldn't afford COBRA and are without insurance is this fair???"

You can help MPR News cover this and other economic topics just by sharing a short story with us about what you're seeing and what the economy is like around you.

Comment on this post

Where are Minnesota's uninsured?

Posted at 3:11 PM on August 13, 2009 by Paul Tosto
Filed under: Health care

The health care debate's gone a little squirrely. So rather than jump into that fray, let's step back and ask a question: Where do Minnesota's uninsured live? You might be surprised. More importantly: Can you help explain it?

Newly released data from the Census Bureau shows Minnesota had the highest percentage of health insured citizens in the country under 65 in 2006 -- about 91 percent. But there are some striking geographical disparities.

Check out this county-by-county map produced by PBS. If you ignore their goofy icons and look at the data it's pretty interesting. (Also, try my low tech but more earnest Minnesota map.)

In total numbers, the high population counties hold the most uninsured. You'd expect that. But look at the at percentages by county.

I'm surprised to see double digits in many southern and southwestern Minnesota counties where unemployment has consistently been the lowest in the state, running mostly between three and four percent during 2006.

I would have guessed that the no-insurance numbers would match up pretty close to the unemployment numbers. It doesn't necessarily look that way. What are we seeing there? Processing plant workers going without insurance? Farmers? Self-employed small town businesspeople?

The highest county uninsured rates are along Minnesota's borders: Cook and Lake of the Woods along the Canadian border and Traverse on the North/South Dakota line.

Take a look at the data and help me understand. Post below or drop me a line and let me know what you take away from the data.

If we can examine pieces of data on who's not employed and where, maybe it'd be easier to talk about solutions. We could use some.

We've heard from people in MPR's Public Insight Network who lost their health insurance with their job, can't pay for expensive COBRA coverage and are basically rolling the dice.

They include Jim Nagy of Nisswa, MN, an art director who told us a few weeks ago he and his family were uninsured.

I just got laid off and started my own company during a very tough time. I'm getting rave reviews from freelance clients but there just isn't any work out there...with the tight budget of starting a company, we can't afford a COBRA...we pray that nothing serious happens.

Kate Krisik, a Network source and administrator with a non-profit, says, "Health care coverage is too expensive for most businesses to maintain for their employees and cost prohibitive for individuals/families to purchase themselves.

My employer does not have a group health insurance policy but will reimburse employees for a portion of their private health insurance premiums. I have been unable to get private health insurance coverage for my husband and me so we are both uninsured.

"There are quite possibly five to seven major issues with health care that all need to be dealt with simultaneously," says David Frank, a source from Canby, MN who's a licensed broker for Blue Cross and Blue Shield of MN and other plans.

"It seems that groups latch on to just one of the issues and then those groups argue with each other over who is correct when in reality they are all correct."

**************************************

We've been asking people to share their experiences in the health care system. You can share your story here.

Life as a MN small business person: a 15 minute tutorial

Posted at 9:14 PM on September 9, 2009 by Paul Tosto
Filed under: Health care, Jobs & unemployment, Small business

Scrambling for capital. Dealing with the stress. Loving what you do.

If you want to know what it's like to be a small business person in Minnesota these days, take 15 minutes and scroll through the virtual forum below. It's a quick lesson in the joys and frustrations of running your own shop.

We asked nine entrepreneurs in MPR's Public Insight Network to talk about credit and cash flow in this economy. They did more, opening a wide ranging conversation on credit, government aid, the strain of starting a business and and what it's like to take that leap into being your own boss.

Check out the dialog below. Here are some of the highlights.

Credit. It's been difficult to impossible at times in this recession to get the credit needed to run a small businesses.

"Tight is the wrong word - non-existent seems to fit a little better," said Michael Schaffer, president of M.A. Schaffer Accounting Services. "Working capital has become extremely hard to come buy, especially for those who need the money.

Schaffer recalled when he started in 2006, :I walked into and out of the bank in less than an hour. With no business plan, unincorporated, and one client, I was given a Line of Credit, Credit Card and Overdraft Line - all based my my credit score and signiture."

"I had perfect credit when applying for my loan. But the bank kept wanting more and more liquid equity for collateral, said Crystal Pollard, owner of Bellies to Babies.

Amy Goetz, founder Bramblewood Treats told us she's dealt with the "We'd like to, but..." conversation with her banker. "I have a great relationship with my banker ... But the automatic program spits a big "no" out." The problem, she said, is that, "I have a student loan on my credit history and don't own my own home."

Joys / stresses of starting a business. The work is their passion but it comes at price in time and stress.

"It's a scary decision, especially now," said Pollard. "But if it's something you're passionate about and commited to, it is one of the best decisions you can make....This is the most stressed I have ever been, but it is totally worth it knowing I'm able to help so many women...With so many people being laid off work and losing jobs, why not start the business you've been dreaming about?

"Oh, yea, the stress ... it ebbs and flows - but I think I'm used to it now," said Shawn Sheely, founder Analog Interactive. I've been trying really hard to reduce stress in myself and my employees by working fewer hours and through simplifying our repetitive tasks and processes.

Goetz says she often calls the business, "my other baby and the only thing I'd rather do. But, the stress is on my shoulders all the time."

Solutions. We asked in various forms what if anything lenders and/or government could do to make things better.

"Somehow, we have to get low interest money to SMALL business owners for capital," said Brady Jass, president B&H Manufacturing. "Big corps have access to investors, lower rates, etc. It is in the country's best interest to fund small businesses to furnish competition to larger corporations. They have tons of advantages that we dont have."

"I'm not sure there's much more I can tell Congress," said Jason Rysavy, founder Catalyst Studios. "It really feels like success rides on my shoulders (and my employees). I'd rather be scrutinized vs handing over cash I may not be able to pay back."

"Make it easier to run a business," said Sheely. "I have to shop health, 401k, pay a myriad of taxes and matches...why can't I just pay my employees their salary and let the governement collect the taxes - I have better things to do than their paperwork.

Health Care. Paying for health care is on everyone's mind these days. But finding real solutions is an absolute must for small businesses.

"Our health care has risen 20-25% every year for the last 9 years," said Rysavy. "And we pay 100% of the employee and 75% of the dependents, so it's killing us."

"Heathcare costs are killing small business potential," said Sheely. "Large companies can manage this through economies of scale ... we're very vulnerable on this one. Can you say pre-existing condition?"

Added Pollard: "I don't offer healthcare to my employees because my family can't even afford it right now. My son is 3 and we can't afford to cover him. We're working on getting state for him.

Health insurance needs: Listening to your neighbors

Posted at 9:07 PM on September 10, 2009 by Paul Tosto
Filed under: Health care

We took a run at the health care debate recently, looking at where the uninsured live in Minnesota. Thanks to my MPR colleagues we're now bringing your voices to the discussion.

Check out the map below put together by MPR's Public Insight Network and ProPublica, the non-profit journalism group. Hundreds of voices from across the country talking about their health insurance experiences.

Zoom into Minnesota, read a few, and you'll get a fast understanding on the chronic insurance problems many of us face. Whatever your take on the debate, there's no doubt the wrong choice on health insurance -- or having no choice at all -- is taking a toll.

MPR's weaving those voices already into news stories. ProPublica is also planning coverage based on the responses as is Marketplace, the public radio business show. We're still looking for more stories. Share yours here.

Meanwhile, the Census Bureau today came out with some new health insurance data. Minnesota remains one of the best states: "only" about 8.7 percent of Minnesotans (roughly 444,000 people) didn't have health coverage in 2008.

The chart below shows three year averages for uninsured. Minnesota is third in most covered, behind Massachusetts and Hawaii. Texas and New Mexico were the worst, with roughly one in four uninsured.

In that sense, Minnesota's doing pretty well. Why? Is it MinnesotaCare, the state-federal program providing insurance to low-income families? Is it employer coverage? The Minnesota Budget Project notes the percentage of Minnesotans with employer-provided coverage dropped from 77 percent in 2000-01 to 71 percent in 2007-08.

So as we read through the stories of struggle, I'm hoping we'll also start hearing stories of what works.